| When are final dividends accounted for? | They will be recorded in the FS only when they were declared before the year end. Otherwise, they will be disclosed in the notes. |
| What is "control" in terms of group accounts? | The power to govern the financial and operating policies of the entity so as to obtain benefits from its activities. |
| What is "significant influence" in terms of group accounts? | The power to participate in the financial and operating policy decisions of an entity, but not to control these policies. |
| What is an associate? | An entity over which the investor has significant influence. |
| What is Significant Influence? | The power for participate in the financial and operating policy decisions of the investee but is not control of joint control over those policies. |
| What sized share holdings are significant? | 20% to 50%. |
| What is Equity Accounting ? | "A method of accounting whereby the investment is initially recorded at cost and adjusted thereafter for the post-acquisition change in the investor's share of net assets of the associate." |
| Using Equity accounting how are assets and liabilities treated? | A single investments in associates line in the non-current assets section of the SFP. These are the group share of the assets and liabilities of the associates. |
| What is required before equity accounting may be used? | Consolidated statements must have already been produced (ie. there must already be at least one subsidiary). |
| Using Equity accounting, how are the expenses and income treated? | A single share of profit of associates line in the SPL, which is the groups share of of any of the associate's profit after tax. |
| How is the investment in the associate calculated for the SFP? | Cost of Investment + Share of post-acquisition profits - Impairment losses - group share of PURP |
| How is an associate treated if there are no subsidiaries? | It will be treated as a trade investment and shown as a non-current asset because there are no consolidated statements to add it to. |
